Reuters: US Dollar Report: STXNEWS LATAM-Brazil stocks affected by gloomy investor perception, BofA says

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STXNEWS LATAM-Brazil stocks affected by gloomy investor perception, BofA says Mar 4th 2013, 12:05 Mon Mar 4, 2013 7:05am EST Analysts at Bank of America Merrill Lynch led by Felipe Hirai and David Beker said investors are still "massively underweight" Brazilian equities as disappointingly low growth rates, accelerating inflation and rising state intervention in the economy are leading to earnings downgrades and a de-rating of a number of sectors. Investors in Latin America, who are also concerned with high valuations in the Mexican stock market, are rotating to Chile and Peru, both analysts said in a note on Monday. "However, we noticed a subtle change on investors' mind, with investors asking about the potential upsides on the economy as the outlook is already gloomy and everyone seems already underweight, but a change in perception will still take a long time to materialize, in our view," the analysts wrote. The most preferred sectors remain consumer goods, infrastructure and education, and the least preferred include energy, utilities and telecommunications. Two sectors that investors remain divided about are financial companies and raw materials producers, both Hirai and Beker said.

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